Budget Committee Considers Report of International Civil Service Commission,

Hears Details of Efforts to Find Equitable Solutions for Staff

The International Civil Service Commission’s attempts over the past year to streamline and improve the conditions of service for thousands of United Nations staff worldwide drew the ire of staff union representatives, as well as one of the Organization’s biggest financial contributors during today’s meeting of the Fifth Committee (Administrative and Budgetary).

Kingston P. Rhodes, Commission chair, laid out the Commission’s efforts to keep employees engaged and motivated while shaping more equitable conditions of service for staff at home and abroad. He introduced the thirty-seventh annual report of the Commission, an independent expert body created by the General Assembly. Last year, the Commission approved wide-ranging measures to eliminate disparities in the treatment of staff from different organizations serving in some of the world’s most difficult places.

While praising such reform and the Commission’s ongoing progress to harmonize conditions of service in non-family duty stations, the United States’ delegate criticized the body’s decision in August to approve an increase in the post adjustment index. During a time of economic hardship for Member States around the world, that had led to nearly a 3 per cent increase in compensation for 4,800 international professional staff serving in New York, he said.

The increase was unnecessary as international Professional staff were already paid more generously than their counterparts in Washington and in the civil services of most Member States. “The cost of this increase is not trivial. It undermines the Secretary-General’s call for belt-tightening throughout the UN system,” he said. “And it should be reversed.”

Yet Mauro Pace, President of the Federation of International Civil Servants Association, objected that staff employees were being repeatedly asked to “do more with less”, even as the United Nations required its financial resources to meet the expanding needs of countries faced with civil unrest and hungry citizens.

His statement mirrored criticisms made by Ridha Zargouni, President of the Coordinating Committee for International Staff Unions and Associations of the United Nations Systems, regarding a reclassification of duty stations that meant employees would now receive “danger pay”, rather than the traditional “hazard pay”. Application of the new criteria would significantly reduce the number of duty stations and staff members eligible for danger pay.

Mr. Zargouni criticized the subjective nature of criteria used by the Commission and noted that United Nations staff members were more frequently called upon to work in dangerous and hostile environments around the world, thereby becoming targets of hostile and violent attacks.

[The Commission outlines the criteria for danger pay in page 63 of its report.] Mr. Rhodes told the Committee that the replacement of hazard pay with danger pay would yield annual savings of about $19 million.

Japan’s delegate supported the decision to set up danger pay for internationally recruited staff, effective 1 January 2012. The Commission’s report noted that danger pay would apply only in extraordinary situations where staff were at high risk as a direct consequence of their employment by the United Nations common system. The Commission agreed to set the level of danger pay at $1,600 per month for internationally recruited staff, effective 1 January 2012.

Lionel Berridge, Acting Director, Programme Planning and Budget Division, introduced a statement submitted by the Secretary-General that detailed the administrative and financial implications of the Commission’s decisions while Collen V. Kelapile, Chairman of the Advisory Committee on Administrative and Budgetary Questions (ACABQ), introduced the Advisory Committee’s related report.

The representative of Argentina also spoke today on behalf of the “Group of 77” developing countries and China.

As the Fifth Committee (Administrative and Budgetary) met to consider its agenda item on the United Nations common system, it had before it the report of the International Civil Service Commission for 2011 (documents A/66/30 and Corr.1 and Corr.2). That report summarized the Commission’s recommendations concerning conditions of service applicable to both categories of staff, remuneration of the Professional and higher categories, and conditions in the field that call for decisions by the Assembly and the legislative organs of other participating organizations. It also summarizes the financial implications of those decisions and recommendations.

Under the first category of recommendations, on conditions of service applicable to both categories of staff, the Commission recommends that the Assembly increase hardship allowance, mobility allowance and non-removal allowance by 2.5 per cent effective 1 January 2012, and that the additional non-family hardship for staff at non-family duty stations be adjusted likewise.

The second category of recommendations, on the Professional and higher categories, dealt with base/floor salary scales, the evolution of the United Nations/United States net remuneration margin, and diversity in the United Nations common system. Under the third category of recommendations, on the conditions of service in the field, the Commission recommends that the Assembly approve changes in the rest and recuperation framework for staff serving in non-family duty stations from five consecutive working days to five calendar days, plus approved travel time.

The financial implications associated with the Commission’s recommendations are estimated as follows: $8.9 million for 2012 for increases to the hardship, mobility and non-removal allowances, plus $8.3 million associated with approved changes to the hardship scheme as shown in annex III; net savings of $2.3 million in “danger pay” owing to a reduction in eligible duty stations for such pay; $7.5 million per annum for cost-of-living increases; $65,000 per annum, system-wide, for an increase of the base/floor salary scale as shown in annex V; and a reduction of $700,000 per annum for establishing unified special operations living allowance rates in non-family duty stations.

The Committee also had before it the statement submitted by the Secretary-General in accordance with rule 153 of the rules of procedure of the General Assembly, administrative and financial implications of the decisions and recommendations contained in the report of the International Civil Service Commission for 2011 (document A/66/394). An advance copy of the report of the International Civil Service Commission for 2011 (document A/66/30) was used to prepared the statement.

If the Assembly approved the Commission’s recommendations, resource requirements stemming from the recommendations under the programme budget for the biennium 2010-2011 will be reported in the context of that biennium’s performance reports. The resource requirements under the Organization’s proposed programme budget and that of the two tribunals for the biennium 2012-2013 would be reflected in the corresponding proposed budget estimates for the biennium 2012-2013, prior to the determination of appropriations to be adopted by the Assembly in December 2011.

The reduced resource requirements for peacekeeping operations and the Support Account for peacekeeping operations would be reported in the related performance reports for the financial period from 1 July 2011 to 30 June 2012, and taken into account in the context of the proposed budgets for the financial period from 1 July 2012 to 30 June 2013.

The fifth report of the Advisory Committee on Administrative and Budgetary Questions (ACABQ) on the proposed programme budget for the biennium 2012-2013 (document A/66/7/Add.4) weighs in on the administrative and financial implications of the decisions and recommendations in the Commission’s 2011 report.

Introduction of Reports

KINGSTON RHODES, Chairman of the International Civil Service Commission ICSC, introduced the Commission’s report for 2011 (documents A/66/30 and Corr.1 and Corr.2). He said one of the greatest challenges to United Nations organizations today was how to remain a competitive employer in an uncertain economic environment. The United Nations must offer competitive conditions of service that were valued by today’s workforce such as learning opportunities, career development, recognition and reward programmes and appropriate measures for difficult duty stations.

Among its recommendations on conditions of service applicable to both categories of staff, which were summarized in the report, the Commission submitted to the Assembly an updated performance management framework, which gave preference to cultivating organizational cultures that kept staff members engaged and motivated, he said. He sought the Committee’s support in urging Executive Heads to adopt and implement the framework as a matter of priority.

The Commission continued to monitor the margin between the net remuneration of the United Nations common system staff in the Professional category and higher in New York and their counterparts in the United States civil service in Washington, D.C., he said. During 2011, the margin stood at 114.9; the average margin level for the 2007-2011 period stood at 114.1. The Commission recommended an adjustment of 0.13 per cent to the base/floor salary scale and revised staff assessment rates for the Professional and higher categories, and decided to review the staff assessment rates every three years.

The Commission, he said, had successfully completed its review of the salary survey methodologies for the General Service and related categories. The new methodologies would go into effect in January 2012. Methodology I would be applied to the eight common system Headquarters duty stations and the six additional duty stations with labour markets similar to those at Headquarters; Methodology II would be applied to all other duty stations.

The Commission recommended establishing unified rates for the special operations living allowance during the transitional period, he said. It also recommended that, as of 1 January 2012, the minimum eligible age for receiving education grants should be lower than 5 for children attending institutions that by law required an earlier start. It recommended discontinuing hazard pay and replacing it with “danger pay”, which would yield annual savings of approximately $19 million, due to a reduction in the number of duty stations eligible under the new criteria.

LIONEL BERRIDGE, Acting Director, Programme Planning and Budget Division, introduced a statement submitted by the Secretary-General in accordance with rule 153 of the rules of procedure of the General Assembly, on the administrative and financial implications of the decisions and recommendations contained in the report of the International Civil Service Commission for 2011 (document A/66/394).

The Statement detailed the financial implications arising from the decisions and recommendations contained in the Commission’s 2011 report on the common system, particularly for the programme budget for the 2010-2011 biennium, the proposed programme budget for the 2012-2013 for the United Nations and the international criminal tribunals. He said that the statement also laid out the financial implications for the peacekeeping operations budgets, starting with the peacekeeping financial period 2011/2012.

Those recommendations would produce financial implications relating to the level of the mobility, hardship and non-removal allowances, “danger pay”, the implementation of the 2010 place-to-place survey results and the base/floor salary scale and staff assessment rates, he said.

The report estimated the following financial implications stemming from the Commission’s decisions and recommendations: a net increase of $15,200 for the Organization’s programme budget for the biennium 2010-2011; a net reduction of $3.27 million for the proposed programme budget for the biennium 2012-2013; net increases of $217,000 and $15,000, respectively, for the proposed budget of the International Criminal Tribunal for Rwanda and the International Tribunal for the Former Yugoslavia for the biennium 2012-2013; and net reductions of $2.5 million and $5.34 million, respectively, for peacekeeping operations for the financial periods 2011/2012 and 2012/2013, he said.

COLLEN V. KELAPILE, Chairman of the Advisory Committee on Administrative and Budgetary Questions (ACABQ), introduced the Advisory Committee’s related report, Administrative and financial implications of the decisions and recommendations contained in the report of the International Civil Service Commission for 2011 (document a/66/7/Add.4).

He said that as in the past, the Advisory Committee had confined its consideration of the Commission’s report to those the Secretary-General submitted to the Assembly in his statement. Sections II and III of the Advisory Committee’s report gave an overview of these decisions and recommendations, which included: a 2.5 per cent increase in the mobility, hardship and non-removal allowances, including the additional non-family hardship allowances; changes to the hardship classification system approved by the Commission at its seventy-second session; the replacement of “hazard pay” with “danger pay”; the implementation of the 2010 place-to-place survey results; an adjustment to the base/floor salary scale; and revised rates of staff assessment.

If the Assembly were to approve the Commission’s decisions and recommendations, he said, the Advisory Committee had no objection to the Secretary-General’s proposed plan, laid out in paragraph 33 of his statement.

Statements by Staff Associations

MAURO PACE, President of the Federation of International Civil Servants’ Associations (FICSA), expressed his objection to being repeatedly asked to “do more with less”. The United Nations had already made cost savings over the years through downsizing and outsourcing. But as countries increasingly confronted civil unrest and hunger, the United Nations organizations needed the financial means to meet their growing needs. He cautioned against making decisions on employment conditions that had long-term and far-reaching negative implications. He expressed concern over calls by some Member States to revoke to recent cost-of-living adjustment in New York. He regretted the Assembly’s decision to reduce allowances for staff in specialized agencies, funds and programmes serving in non-family duty stations, saying it would affect their ability to operate effectively.

He called for clear, coherent and consistently applied methodologies to develop and implement adjustments and entitlements. He urged the Committee not to accept the recommendation to amend the rest and recuperation policy from five consecutive working days to five consecutive calendar days, plus approved travel time. Doing so would lead to a lack of qualified, experienced staff to carry out the United Nations mandate in difficult duty stations. He called for giving equal “danger pay” to internationally and locally recruited staff and asked that the anticipated savings from the applying the new danger pay scheme be used to increase the level of that pay and to improve the scheme applied to locally recruited staff.

He reiterated the Association’s long-standing request for recognizing hazard pay, now to become danger pay, for staff of the United Nations Relief and Works Agency for Palestine Refugees in the Near East (UNRWA). He reiterated his dismay over the considerable reduction in the number of duty stations eligible for danger pay owing to the new criteria, which was far too restrictive. He supported the current system of annual pensionable increments. Rewards should be additional, fully funded and stable and should focus on teamwork. Decisions concerning award recipients should be made by a committee that included staff representatives. The Association saw little value in specific suggestions on non-monetary rewards and refuted the argument in the proposed framework that staff members were responsible for their own academic and professional development and that organizations could use training or development as part of their reward scheme.

Taking note of the decision not to proceed with Phase II of the Noblemaire study, he called for a review of the methodology used to prepare it in order to align United Nations employment conditions with the most competitive realities, including those of other international organizations. He also expressed alarm at the exponential growth in the use of non-staff throughout the organizations.

RIDHA ZARGOUNI, President of the Coordinating Committee for International Staff Unions and Associations of the United Nations Systems (CCISUA) said he was frustrated that the Federation, which represented nearly 40,000 staff members from 17 organizations of the United Nations common system, was “given just 300 seconds to speak and little or no opportunity for interaction to relay to you, our employers, the concerns and issues that were affecting many thousands of staff”.

During sessions with the Civil Service Commission, the CCISUA had expressed its disappointment that the Commission was not open to suggestions from the organization or staff representatives. “Instead, the outcome seemed to be largely based on preconceived ideas regarding ways to undertake the deepest budget cuts,” he added.

While recognizing the difficulties the financial crisis had created for Member States, the Federation believed the proposed measures considerably impacted the conditions of service for staff, particularly those in the field. Overall, the measures reduced the Organization’s capacity to attract and retain staff with the “highest standards of efficient, competence and integrity”, he said. CCISUA was concerned about the reduction of incentives for service in the field when the Secretariat expected staff to be more mobile.

Regarding the Civil Service Commission report, he said that the Federation opposed the de-linking of the mobility-hardship scheme from the base/floor salary scale and regretted the significant reduction in the number of duty stations covered by danger pay. CCISUA had serous concerns about decisions related to the determination of non-family duty stations because of the lack of consideration of health and adverse living conditions.

He criticized the subjective nature of criteria used by the Commission and noted that United Nations staff members were more frequently called upon to work in dangerous and hostile environments around the world, thereby becoming targets of hostile and violent attacks.

Regarding the rest and recuperation issue, the Federation was concerned about a proposed change in the accounting of days from five working days to five calendar days. The ICSC decision was taken without any open debate or discussion and did not produce cost-savings, he said. “It appears only to be punishment for staff who worked tirelessly in very difficult non-family duty stations,” said Mr. Zargouni, adding that staff members’ productivity increased with this simple measure. The Federation intended to challenge the decision if it was implemented.

Turning to performance management, he said that the Federation welcomed new ways to motivate staff and reward performance but believed these methods should be additions, rather than replacements of existing mechanisms. The CCISUA reiterated its claims that any comparison with a national civil service be carried out in a complete manner and recognize the additional elements of hardship and mobility faced by United Nations staff.

On the harmonization of conditions of service in the field, he repeated his organization’s disagreement with the harmonization of conditions of service in non-family duty stations. It particularly disagreed with the marked decrease in benefits for single staff members, those most likely to be able to work in the difficult non-family duty stations, and discouraged their mobility.

Statements

MARCELO SUÁREZ SALVIA ( Argentina), speaking on behalf of the “Group of 77” developing countries and China, took note of the Commission’s report and its recommendations. The Group supported the common system approach to developing and applying conditions of service and the principle that all staff serving under similar conditions should receive equal treatment. The Organization had a responsibility to provide its staff with a well-deserved and respectable remuneration package, with enough incentives and allowances to enable them to perform their work efficiently and effectively amid ongoing challenges. In that regard, he supported the recommendation to adjust the current base/floor salary scale for staff in the Professional and higher categories, the proposed 2.5 per cent increase in hardship allowance, mobility allowance and non-removal allowance.

He also supported the use of “danger pay”, implementation of the 2010 place-to-place survey results and the approved changes to the hardship reclassification system. The Group appreciated the Commission’s various inputs in its report, particularly those related to geographical representation, gender balance and diversity. Adequate resources should be appropriate during the Assembly’s sixty-sixth session to fully implement the Commission’s proposals. The Group welcomed the survey and report on diversity in the United Nations common system and it was ready for detailed discussion on how to formulate more suitable recruitment policies to promote diversity.

TAKASHI KANAMORI ( Japan) supported the common system’s goal of creating efficient and effective conditions of service. He noted the Commission’s decision to grant a 2.5 per cent increase in the hardship allowance, mobility allowance and non-removal allowance and to adjust by the same percentage on 1 January 2012 the additional non-family hardship allowance for staff serving in non-family duty stations. He recognized that the level of the additional non-family hardship element for staff with dependents was originally set at 100 per cent of the dependency rate of the hardship allowance for category E duty stations, but asked for clarification as to why the level was adjusted in such a short period of time after its introduction and kept pegged to the corresponding hardship allowance level.

He lauded the decision to establish “danger pay” for internationally recruited staff, effective 1 January 2012, as it focused more on the imminent threat to staff and their activities. But he asked whether danger pay would be paid to staff during their rest and recuperation travel away from the duty stations. He refuted the argument that continuing danger pay during rest and recuperation periods would motivate staff to use those periods, saying that using danger pay in that way would go against its original purpose. The issue of how to facilitate effective rest and recuperation periods should be considered separately. He welcomed the Commission’s decision to study recruitment policies with a view to recommending to organization measures that fostered diversity. He looked forward to concrete recommendations in the near future to create more geographical diversity among staff in the common system.

JOSEPH M. TORSELLA ( United States) said his delegation strongly supported the Civil Service Commission’s work to harmonize the conditions of service throughout the common system. He noted that last year, the Assembly, following the Commission’s recommendations, had approved measures to eliminate disparities in the treatment of staff from different organizations serving in some of the world’s most difficult places. The United States was pleased with the progress and expected the Commission to keep closely monitoring the implementation of harmonized conditions of service in non-family duty stations.

The United States noted the observations of the Commission on the net remuneration margin between United Nations Professional staff and United States federal civil service employees. The conditions of service for international Professional staff should be determined in reference to the practices of the United States federal civil service under the Noblemaire principle. But the Commission’s recent action to increase the post adjustment index in New York is at odds with this guiding principle of the international civil services.

Federal employees in the United States were subject to a pay freeze that affected both base salary and locality pay. Last November, President Barack Obama moved to freeze United States locality pay, which was analogous to post adjustment pay in the United Nations. Although the United States freeze in salary was reflected in the base salaries of international Professional staff, the freeze in locality was not reflected in post adjustment. In August, the Civil Service Commission had approved an increased in the post adjustment index that led to nearly a 3 per cent increase in the compensation of 4,800 international professional staff serving in New York.

This increase was not appropriate as most Member States were encountering severe economic difficulties. Fiscal restraint was in order. The increase was not necessary as international Professional staff were already paid more generously than their counterparts in Washington and the civil services of most Member States. “The cost of this increase is not trivial. It undermines the Secretary-General’s call for belt-tightening throughout the UN system,” he said, adding: “And it should be reversed.”

The United States asked the Commission to consider changes necessary to the comparator system to prevent the occurrence of similar situations. In the meantime, the United States strongly believed the New York post adjustment index should be immediately restored to the July level and the net remuneration for international professional staff in New York should remain at that level until the locality pay freeze for United States federal employees was lifted.

Response

Mr. RHODES, taking the floor a second time, said the Commission had found no compelling reason at this stage to change its use of the United States civil service as the comparator civil service on which United Nations pay scales were based. It had decided to conduct another study on that matter in four or five years and to continue to use the United States as a comparator under the Noblemaire principle. The Commission decided to take steps to regulate that relationship. He recalled its previous decision to adjust the United Nations/United States net remuneration margin to account for high inflation in the United States.

He said the 2011 margin of 114.9 took into account the freeze in gross salary levels in the United States this year and the changes in the United States tax rate schedule, which had resulted in an increase of 0.13 per cent in United States net pay for United States civil servants. The recent increase in United Nations post adjustment allowance was within the set average margin range of 110 to 120. He recalled that, from August 2008 to August 2009, no increase had been warranted or granted in the United Nations even though there was an increase of about 3 or 4 per cent in the United States pay scales.

The United Nations, which operated as an international system, was not “tied in lock step” with the United States even though it looked to the latter for comparisons, he said. Still, the Commission did not want the United Nations in New York “to drift far away” from the United States.

He said the issue of monetizing benefits was on the Commission’s work programme as it related to salaries in the field, whereas the base salary was less than allowances for staff. Regarding the 2.5 per cent increase in hardship and mobility allowance, he said the Commission had attempted to have a system that was simple.

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